From The League of Cities’ City Advocate Weekly

The Legislature was up to many of its usual shenanigans on Thursday in its attempt to finally secure a spending plan for California, more than three months into the fiscal year, with a last minute effort to jam a Transient Occupancy Tax (TOT) bill in along with the budget. The bill, SB 848 (Hollingsworth), was ultimately rejected, showing the power of cities to defeat measures that threaten local control and revenues.

There has been an effort, both here in California and in Washington, DC, by Online Travel Companies (OTC) in the last year to continue to circumvent remitting the full amount of TOT to local jurisdictions. Thursday, language was inserted into SB 848 to try to sneak this into the budget.

SB 848 has nothing to do with the state budget and has no affect on state revenues or spending. The issues involved are complicated and affect pending litigation in California. The bill’s sponsors attempted to represent SB 848 as a “technical fix,” but that was far from the truth. In fact, this legislation was part of a multi-state and national campaign by OTCs to avoid liability for pending litigation and permanently deprive California cities of approximately $200-$300 million or more annually in general revenues.

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